These days, the world's most exotic locales are boasting more than just a bustling tourist industry. It happens that their local telecom companies are also attracting foreigners. Foreign investors, that is. The timing on the following issues couldn't be better. Here are four global telecom leaders with great dividends, and trading with solid, value investment metrics.
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A Sunny Brazilian Beach
Telemig Celular Participacoes S.A. (NYSE:TMB) is a Brazilian cellular telephone company with an outstanding record of growth. This past year, despite violent economic headwinds, the company tacked on 20% more customers to its subscriber base - its highest ever jump since its founding. Shareholders are happy, too. The stock bottomed in November at $24.30 and now trades at over $50.00 per share.
And yet for all that, TMB stock still delivers great fundamentals. The dividend yield is still a robust 10.5%, and the shares trade with a very reasonable trailing P/E multiple of about 11.8x.
New Zealand will not be Undersold
This island gem, tucked into the furthest corner of the world, is also offering a telecom high yielder, Telecom Corp of New Zealand (NYSE:NZT), which pays investors about 9.0% annually and sports a P/E of just 9.8. It also trades with an impressive price-to-sales ratio of just 0.86.
NZT is also well ahead of sales targets on its recently launched XT mobile network. The company invested NZ$574 million to create the system and claims it’s now on pace to catch rival Vodaphone in its bid to boost local market share.
A Wireless Company with S(e)oul
SK Telecom Co., Ltd. (NYSE:SKM) is South Korea's premier wireless service provider. The shares trade with a P/E of about 10.8 and offer an annual yield of 8.8%.
Two other measures of value show SKM stock to be well-priced at present: price-to-book is an industry leading 1.26, and price-to-sales a low 0.95. SK Telecom stock is up 25% from its 52-week low four months ago.
France Telecom SA (NYSE:FTE) is another issue with an eye-popping dividend. Currently paying around 10% annually and trading with a P/E of 10.50, FTE owns both fixed-line and wireless businesses in Europe and West Africa.
France Telecom was recently issued an A- (Stable) rating from Fitch Ratings, which commented that FTE’s "business model is so far proving more resilient in the downturn than some other European peers," due in part to its continued ability to generate strong cash flows. (Learn about rating agencies in our article, Bond Rating Agencies: Can You Trust Them?)
The Wrap
Telecom ADRs are in the spotlight now, both because their fundamentals are attractive and because their payouts are so expansive. The four issues discussed above are an excellent place for interested investors to begin their search. (Find out more about metrics to look at when analyzing telecoms in our article Dial Up Choice Telecom Stocks.)
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